Lender update: Coronavirus & Current mortgage rates

As the COVID-19 virus wreaked havoc on the world’s financial markets and disrupted a red-hot American economy, the mortgage industry in the United States has had to respond to a variety of unanticipated challenges and changes.

The good news is we are still here and working to serve our customers and business partners.

As you may already know, when news of the COVID-19’s potential impact on American business was made known, the stock market tumbled, and bond yields reacted. That sent interest rates, which were already quite low, to even lower levels (at least for a couple of days) that had not been seen in decades.

As rates attempted to adjust back, the Federal Reserve cut short-term interest rates to stop a potential crisis in the economy. Instead of giving home sales a boost in the arm, and to increase confidence in the housing market, it created a wave of refinance applications which have pushed many large lenders, banks and credit unions to their maximum capacity.

The stories of waiting eight weeks to close, getting sudden last-minute conditions from underwriters, delaying appraisals and lenders tightening guidelines (on popular loan products) are real. In addition, with so many people hopping from lender to lender to try and save .125% on a refinance, many lenders now require that a loan be completely approved by underwriting before you can lock in your interest rate.

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